Greetings, and welcome to CorMedix Fourth Quarter 2018 Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now pleasure to introduce your host, Daniel Ferry, LifeSci Advisors. Please go ahead, sir.

Good afternoon. And welcome to the CorMedix fourth quarter 2018 investor conference call. Leading the call today is, Khoso Baluch, Chief Executive Officer of CorMedix. He is joined by Bob Cook, Chief Financial Officer of CorMedix; Liz Masson, Executive Vice President and Head of Clinical Operations; and Paul Chew, Chief Medical Officer. After the prepared remarks, we will open up the call for Q&A. Before we begin, I would like to remind everyone that during the call, management may make what are known as forward-looking statements within the meaning set forth in the Private Securities Litigation Reform Act of 1995. These statements are subject to certain risks and uncertainties and include, but are not limited to, any of the following. Any statements other than statements of historical fact regarding management’s expectations, beliefs, goals, and plans about the Company’s prospects, including its clinical development program for Neutrolin in the U.S. and other product candidates, future financial position, future revenues and projected costs, and potential market acceptance of Neutrolin and other product candidates. More specifically, forward-looking statements include any statements about our clinical development plans and the timing, costs, results, and interpretations thereof, projections as to the Company’s future capital raising, and spending and cash position, expectations as to the timing and nature of anticipated regulatory actions, possible product licensing or other business development transactions, any commercial plans and expectations, market projections for our product candidates, and expectations as to manufacturing and product component costs. Actual results may differ materially from these projections or estimates due to a variety of important factors, including, but not limited to, uncertainties related to clinical development, regulatory approvals, and commercialization. These risks are described in greater detail in CorMedix filings with the SEC, copies of which are available free of charge at the SEC’s website at www.sec.gov or upon request from CorMedix. CorMedix may not actually achieve the goals or plans described in these forward-looking statements, and investors should not place undue reliance on these statements. Please note that CorMedix does not intend to update these forward-looking statements, except as required by law. At this time, it is now my pleasure to turn the call over to Mr. Khoso Baluch, Chief Executive Officer of CorMedix. Khoso, please go ahead.

Thank you, Dan. Good afternoon, everyone, and thank you for joining us on this call. Today's call will focus on the three areas most critical to driving value for CorMedix. Number one, the Phase 3 LOCK-IT-100 clinical trials for Neutrolin, in particular the progress we can report from our last meeting with the FDA and the work we are currently undertaking in order to provide FDA with the analysis requested for the complete. Number two, an update on the Company's financial position and strategy including balance sheet, capital raises and planned reverse stock split. And number three, an update on the recent Board appointment. Before we get into details, let me cover a couple of key highlights. First, during the month of January, we made two announcements related to LOCK-IT-100 study. First, we shared the top-line results of the interim analysis on January 17 followed by a second announcement on January 30 on the primary endpoints of the study based on the full dataset. Please note that the CorMedix team became unblinded only after the database lock just prior to the full dataset top-line release. Subsequently, on February 14th, we announced that we had begun discussions with the FDA regarding the use of the recently unblended Phase 3 LOCK-IT-100 study as a single study to support regulatory approval for Neutrolin. The Company's investigational product in development as a catheter lock solution for patients suffering from end stage renal disease undergoing hemodialysis. To be clear, this meeting with the FDA was not a pre-NDA meeting, rather it was a meeting to discuss specifically the regulatory pathway for bringing Neutrolin to the market. We were delighted that the FDA agreed to this discussionary meeting and that the meeting went forward despite an intervening government shutdown. At the meeting, the FDA agreed that…

Thank you, Khoso. First, we're pleased with the outcome of our meeting with FDA. It was a good start of the dialogue we expect to have with them. I want to tell you more about the meeting as I receive questions about it. The specific the meeting we had with FDA was a meeting to discuss the regulatory pathway for Neutrolin in line with the extraordinarily positive results that we received during our interim analysis. This meeting was requested by CorMedix to revisit the previous guidance that the FDA had provided to the Company as the Neutrolin’s regulatory pathway and the timing of the filing of an NDA. We clearly wanted to have this discussion with FDA as soon as possible while we continue to work on the database lock and begin analyzing the full dataset. As it happens, the timing of the FDA meeting coincided with the database locking and the top-line readout of the full dataset as well as the receipt of the DSMB’s guidance after they had reviewed the top-line data. During our meeting with FDA, we’re able to share this new information that we believe further strengthened our request that the data from LOCK-IT-100 provides substantial evidence of safety and effectiveness. The FDA's information request to us from the meeting was expected in light of the fact that the full dataset has just recently become available for us to start our internal review. Liz will provide you a flavor of the effort underway. Once this phase and the discussion is completed and should the FDA agree that CorMedix can file an NDA based on our single clinical trial, we'll then enter into the next phase of our discussions, which is an end of Phase 3 meeting. This end of Phase 3 meeting usually occurs once the clinical study report is completed. After this phase, we'll have a pre-NDA meeting in which we will cover such topics as how to plan to file the NDA, for example by rolling submission, the element of the submission, requesting a priority review LPAD request et cetera. In addition, there are several other meetings that usually take place with FDA on an ongoing basis, so that we can obtain guidance from the agency relating to the individual sections of the NDA. I hope this clarifies and helps to clarify where we are in our ongoing discussions with the agency. Now, let me hand the floor to Liz who'll provide you further colors as to the current efforts in preparing the information for the FDA. Liz?

Thank you, Paul. As Khoso and Paul mentioned, a cross-functional team is working on preparing a material that will be sent to the FDA, based on their further information requests during the recent face to face meetings. The information the FDA requested is a subset of the clinical section one would normally expect while you file an NDA. Since our request of the FDA, it’s to reconsider their previous two study requirement guidance on the regulatory pathway. FDA is interested in seeing additional information before making a decision. This additional information requires the team to plan and perform more extensive analyses to ensure that all aspects of the clinical data are reviewed and available. While we looked previously at these data focused on CRBSI as the primary endpoint, we are now broadening the analyses to look at the data cumulatively and collectively. The effort is in two basis, first, we have to compile a significant amount of data to perform many analyses for a variety of different data points. For example, the specific pathogens identified by subject, agent location of catheters and adverse events just to name a few. As we discussed before, due to the medical complexities of these subjects, the volume of data from the many hospitals and clinics requiring review and analysis is significant. There is a very large number of adverse events to review, one subject alone could have 30 such adverse events. Further, we are carefully reviewing the events leading up to a CRBSI along with any and all contributing factors. This requires the preparation of numerous tables using strict quality controls coupled with sensitivity analyses to see if there is any statistically significant trend. Once this phase is completed and we have the tables, we will then have to tie thread to all of this information to support Neutrolin's clinical performance. As I previously mentioned, all of this information and more would normally be prepared as part of an NDA filing. Therefore, as we spend time analyzing the data on the front end, it may not significantly affect the overall timeline for NDA filings. Please remember that until we have the pre-NDA meeting, it would be premature to speculate on firm timelines as to when we would file the NDA. I hope this helps clarify where we are in the process. I will now turn the call back over to Khoso.

Thanks, Liz and Paul. Clearly important work for CorMedix as we prepare the required information to submit to the FDA. Now, let me ask Bob to cover quarter four financial results and CorMedix's overall finances. Bob?

Thank you, Khoso, the company has filed its annual report on Form 10-K for the year-ended December 31, 2018. I urge you to read the information contained in the report for a more complete discussion of our financial results. With respect to our financial results for the 12 months ended December 31, 2018, our net loss was approximately $26.8 million or $0.30 per share compared with a net loss of $33 million or $0.60 per share for the year-ended December 31, 2017. Lower operating expenses during the fourth quarter of the year accounted for the much reduced net loss in 2018. Operating expenses during 2018 amounted to $26.9 million compared with $33.1 previous year, a decrease of $6.2 million or 18.7%. The decrease in operating expense was due primarily to the benefit derived from the financial settlement with our CRO in November 2018. I will discuss this in more detail in a few moments. R&D expense decreased by $5.6 million compared with 2017, while SG&A expense declined by approximately $0.6 million. Cash used in operations during 2018 was approximately $23.7 million compared with cash used of $28.6 million in 2017. The reduction in cash used in operations occurred primarily as a result of the CRO settlement reflected in the lower net loss for the year coupled with modest year-over-year increases in accounts payable and accrued expenses plus reductions in inventory, receivables and prepaid expenses. With respect to our financial results for the fourth quarter of last year, we recorded a net income from operations of $2.1 million compared with the loss of $10.3 million in the fourth quarter of 2017 and an operating loss of $10.2 million in the third quarter of 2018 just for comparison. The CRO settlement was the primary reason we recognized income in the quarter. As…

Thank you, Bob. What Liz, Paul and Bob covered with you hopefully provides you insight into the important events on which we are focused that have occurred since our last update in November 2018. I'm pleased about the progress we are making. I would like to reemphasize, first, as Paul elaborated, our current discussions with the FDA are occurring prior to an end-of-phase and a pre-NDA meeting. We are having this discussion now, because we would like the FDA to reconsider the previous guidance on requiring two studies in order to file an NDA. We saw this additional step because of the great results we saw from LOCK-IT-100. As Liz indicated, we are diligently working on completing the analysis requested by the FDA. The focus here is to ensure quality and completeness. As Liz indicated, this may not significantly change the overall timeline. Bob provided a lot of color, not only on CorMedix balance sheet and cash flow, but also the steps that were taken in financing the Company. We are effecting the reverse split, which was approved last year now, because we believe it is an opportune time to do so. The 1 to 5 split ratio is the smallest we can do based on the shareholders’ approval. We believe the cash we have in hand is sufficient for us to complete the regulatory discussions with the FDA and file an NDA, if the FDA agrees with our request to file based on a single study. If approved, we've believe Neutrolin will become the standard-of-care for preventing catheter-related bloodstream infection, and taurolidine will have significant other applications against inflammation and infections. I'm very pleased with the strength of our management team, adding Liz and Paul last year and recently appointing Alan to the Board earlier this year. We will continue to evolve by augmenting our team over the coming year. I'm also confident that the strategy we embarked on in early 2017 will continue to move steady fast forward at an ever-increasing pace. I look forward to providing you with material, developments, updates via the CorMedix website, press release and conference calls. Thank you for your continued support of CorMedix. Let me now hand the call back to Dan.

Ladies and gentlemen, we'll be conducting a question-and-answer session. [Operator Instructions] Our first question today is coming from Ram Selvaraju from H.C. Wainwright. Your line is live.

Hi. Thanks very much for taking my questions. And thanks very much for detailing all of this progress. A couple of housekeeping items for Bob, if I may. I presume that the CRO settlement is a one-time event and there will be no future recurring impact from this CRO settlement going forward in future quarters, is that correct?

Yes. Ram, that is correct. I mean, there are some payments, as I mentioned that are being made in 2019 that we agreed to make when we signed the settlement agreement. But, once that is done, that's it. So, in my view, it was a one shot deal. And what we're going through now is basically just closing -- finishing the study and then finalizing the amount of the payments that were due to our CRO under the settlement agreement, and then making those payments, which I indicated, should be completed by the end of the second quarter.

And then, could you just refresh my memory as to what changes there have been on the cash level since the end of 2018 with respect to any activities that you had on the ATM?

Well, as I said, Ram, I mean, we used the ATM in the fourth quarter. I think, I said, we had raised $11 million, by the end of December. And then, we used it to raise another $15 million up to today. And at this point, we have achieved what we wanted to achieve in terms of having sufficient liquidity to run the Company for a good period of time. So, it was important to us that we get the auditors situation fixed, so that we don't have to worry about a going concern anymore, and we've done that. And we want to have enough runway to complete the work that we're doing now with the study and also to have guidance from FDA. So, hopefully being positive we’ll be able to file the NDA this year. So, we are financed to the point where we can focus on the business and raising money to continue operations for another quarter, it’s not something that we have to spend time on.

Okay. So, just to clarify. The convertible debt financing closed in January that was for gross of $7.5 million and so far -- since the end of 2018, you’ve brought in another $15 million off of the ATM, is that correct?

Yes. That's correct.

Okay, great. And then, just a couple of things regarding the NDA filing preparation. Have you -- I don't recall whether you said that you have formerly requested the actual pre-NDA meeting, yes or not? And if not, if you could just remind me what specific gating items still remain before you actually request it?

Yes. Our plan is to, first of all, complete the analyses and finalize the FDA package for the items they requested when we met with them. Once the package is completed, we’ll send it to the FDA with a meeting request. It is not the end-of-Phase 3 meeting, it's a meeting request to talk with them about their data. It's up to the FDA if and when they give us a meeting. And if a meeting is granted, it generally occurs within a 75-day period of the request. So, this is before the end-of-Phase 3 meeting.

And when you say end-of-Phase 3 meetings, is that synonymous with pre-NDA meeting?

Well, the end-of-Phase 3 meeting is when you usually have the final clinical study report. And when that's done you discuss the findings with FDA. That is then followed with the pre-NDA meeting. And the pre-NDA meeting talks a lot about the technical details of the filing, how we're going to file, rolling submission, et cetera. So, it's a series of meetings that are building on the previous one, providing more information to FDA, getting more information from them. So, it's a stepwise process.

Okay, understood. So, just for clarity sake, going into the actual pre-NDA meeting, will you know whether at that juncture the FDA would be permitting a rolling submission or not or is that going to be part of the pre-NDA meeting discussion as well?

Yes. It’s all part of the pre-NDA submission -- pre-NDA meeting.

Okay. And just if I could ask hypothetical question. If the NDA were to be permitted by the FDA to be submitted on a rolling basis, could you tell us whether this is likely to be a 3 module submission or 4 module submission or you have no idea at this juncture?

I think, it's too early at this point, Ram. We're going to be putting the cart before the horse if I were to respond to that. I think our first intent is to respond to the FDA requests for the analyses they recently requested and we're going to take it from there.

Okay, fair enough. And then, one quick question for Khoso, if I may. With respect to potential preparation for commercialization in the United Sates. Could you, A, give us a sense of what the training of initiation of those commercialization preparations might be? And secondly, if you could perhaps give us some commentary on what they might consist of? Thank you.

Thanks, Ram. So, two pieces. In the U.S., we’ve really not done much commercial preparations since 2017. You heard Bob color in his talk a little bit of efforts that we started to put on that front. And the focus areas where we spend now some time and we will continue to spend some time on it is linked to two main key areas. One of them is the brand name. There are some very specific regulations that we need to pass-through to get that prepared, so that we could submit it to the FDA. And so that effort -- we’ll spend time on that effort because that is time-sensitive. And the second is to begin to get below the skin in terms of market access. Now, this work will continue, but we will keep it at a little burn till we've got clarity from the FDA. And we have enough timing then to be able to up the burner and be ready in time for a launch in the U.S.

Out next question today is coming from Jerry Isaacson from ROTH Capital. Your line is now live.

First thing I want to do is just clarify one of the comments that have been made. It seems like you said the FDA has said that Neutrolin could be eligible -- or is eligible for OPEB status, but also you don't have definitive word yet from the FDA on whether or not the NDA can be filed with just the one Phase 3 study. Wonder if you can kind of put those two -- square those two statements for me and give a little more context there.

What FDA said was that we are welcome -- CorMedix is welcome to request OPEB status. That's something that's made that decision whether that application is accepted by FDA, would be during NDA submission, so that we’re eligible to request it. But, it's not automatically granted until they have the NDA in hand.

Okay, thanks. That's actually the only question I had after Ram's questions. So, thanks a lot. I appreciate it.

Thanks, Jerry.

Thank you. That does conclude our question-and-answer session. I'd like to turn the floor back over to management for any further or closing comments.

Thank you very much. Well, I'd like to thank everybody who's on this call but also the team and the Board in the guidance as we continue to move forward. We're very excited at where we are at the stage of the Company. And we look forward to providing updates, again through our website, press release or conference calls depending how material the information is. So, thank you very much and thank you for your support. Good bye.

Thank you. That does conclude today's conference call. You may disconnect your lines at this time and have a wonderful day. We thank you for your participation today.